SEC. 5. That the preservation of the constitutional principle of separation of powers requires that any departure by the executive agencies from the observance and employment of the policies, standards, procedures, and techniques reflected in and growing out of the law governing the conservation and development of the land and water resources of the Nation be effected only after approval by the Congress. SEC. 6. That the Committee on Interior and Insular Affairs and the Committee on Public Works be, and they hereby are, directed jointly to study, in consultation with other appropriate committees and executive agencies, and to design and to formalize a comprehensive and particularized set of standards and overall criteria for the evaluation of all proposed projects for the conservation and development of land and water resources, including attention to the several specific factors recognized in section 4 of this resolution, all to the end that the Congress shall fully exercise its constitutional powers, as reflected throughout the text of this resolution. The Committee on Interior and Insular Affairs and the Committee on Public Works are hereby directed to submit to the Senate, as early as practicable during the first session of the Eighty-fifth Congress, a detailed report with respect to their implementation of this section. EXHIBIT 2 STAFF CONSULTATION AND STUDY Senate Resolution 281 directs the Committees on Interior and Insular Affairs and Public Works jointly to study, in consultation with other appropriate committees and executive agencies, and to design standards and overall criteria for the evaluation of all proposed projects for the conservation of land and water resources. Study and consultation have been pursued in accordance with that direction. Collaboration was requested from the Committee on Agriculture of the Senate, and the Committees of Interior and Insular Affairs, Public Works, and Agriculture of the House of Representatives. The Comptroller General has also cooperated, as has the Federal Power Commission. Consultations have been held with and comments have been received from the Bureau of the Budget, the Departments of the Army, Interior, and Agriculture. This collaboration has been helpful in formulating the recommendations of this report. It is gratifying to report that there has been active cooperation in this study by representatives of State and local government agencies concerned with water resources. In addition, nongovernment organizations have participated in the consultations. This ready response has provided full benefit of the experience of the responsible leadership in the areas affected. It is also reaffirmation of the importance accorded to this matter by the non-Federal interests. The committee print of January 4, 1957, presents the comments and recommendations of 6 Federal agencies, 6 non-Federal governmental agencies, and 12 nongovernmental organizations. (These comments are attached as exhibits 4-10.) Committee Print No. 2 of January 24, 1957, presents comparative analyses of different methods of allocation of the costs of typical multiple-purpose waterresource projects. Committee Print No. 3, of February 13, 1957, is the report of a staff conference regarding these matters. That conference included representation of the aforementioned Federal and non-Federal agencies and organizations. PREVIOUS REPORTS AND STUDIES The staff reviewed previous studies and gave particular attention to six reports made at Presidential level concerning water resource problems of national significance. These reports are: 1. Commission on Organization of the Executive Branch of the Government (First Hoover Commission): Concluding Report and Appendix L-Natural Resources. 1949. 2. President's Water Resources Policy Commission: Water Policy for the American People. 1950. 3. President's Materials Policy Commission: Resources for Freedom. 1952 (H. Doc. 527, 82d Cong.). 4. Missouri Basin Survey Commission: Missouri: Land and Water. 1953. 5. Commission on Organization of the Executive Branch of the Government (Second Hoover Commission): Water Resources and Power. 1955 (H. Doc. 208, 84th Cong.). 6. Presidential Advisory Committee on Water Resources Policy: Water Resources Policy. 1955 (H. Doc. 315, 84th Cong.). EXHIBIT 3 BUREAU OF THE BUDGET CIRCULAR A-47 AND CIRCULAR A-47 (REVISED) EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, To the heads of executive departments and establishments. In connection with the attached circular, it is desired to bring to your attention a memorandum regarding the circular which is being sent to the heads of the agencies having responsibility for the development of water and related land resources programs. The memorandum is as follows: EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, Washington, D. C., December 31, 1952. Memorandum for: Secretary of Agriculture; Secretary of the Army; Secretary of Commerce; Secretary of the Interior; Secretary of State; Chairman of the Federal Power Commission; Administrator of the Federal Security Administration; Chairman of the Board of the Tennessee Valley Authority. Subject: Bureau of the Budget circular on water resources projects. The attached Bureau of the Budget Circular No. A-47 is designed to set forth the standards and procedures which will be used by the Executive Office of the President in reviewing proposed water resources project reports and budget estimates to initiate construction of such projects, submitted in accordance with existing requirements. It has been generally recognized that the absence of a clear statement of uniform standards and procedures has resulted in delays and difficulties in the clearance of project reports. The attached circular, which has grown out of more than 2 years of work in the review of water resources policy, is intended to bring together certain of the existing policies of the President which have been set forth from time to time in Executive Office action on project reports, and in some cases to develop modified standards for action on project reports. While there is general agreement on most of the substantive provisions of the circular, there remain some differences of opinion with respect to the position taken on certain issues. As indicated in the circular, however, its issuance is in no way intended to restrict the content of agency reports submitted to the Bureau of the Budget for review on behalf of the President, nor to determine the position which agencies may take with regard to substantive issues. However, it is hoped that, within the framework of existing general provisions of law, the circular will encourage the adoption of more uniform agency policies and standards, and that it will give the agencies a better basis for presenting all the pertinent information which has a bearing on the merits of proposed projects. Also, since most project reports submitted to the Bureau become the basis for proposed legislation, it is believed that issuance of the circular will be helpful in pointing up specific policy areas which may require special attention by the President and by the Congress. It is to be assumed that experience in the application of the circular will show the need from time to time for modification in its provisions. In particular, it is recognized that further study and refinement will be desirable with respect to (1) the measurement of project benefits, (2) the method of allocating project costs, and (3) the price level assumptions to be used in evaluating both benefits and costs. The Bureau of the Budget wishes to express its appreciation for the great assistance which has been given by many individuals in the agencies concerned in the preparation of this circular. It wishes also to acknowledge the value of the report of the Fresident's Water Resources Policy Commission in the preparation of this circular. This memorandum is being sent to the heads of all agencies having responsibility for developing water and related land resources programs. FREDERICK J. LAWTON, Director. EXECUTIVE OFFICE OF THE FRESIDENT, CIRCULAR No. A-47 To: The heads of executive departments and establishments. Subject: Reports and budget estimates relating to Federal programs and projects for conservation, development, or use of water and related land resources. 1. Purpose The policies of the President with regard to programs and projects for the development of water and related land resources have been established from time to time both as a part of the normal budget and legislative review process under Bureau of the Budget Circulars No. A-11, Instructions for the Preparation and Submission of Annual Budget Estimates, and No. A-19, Reports and Recommendations on Proposed and Pending Legislation, and as a part of the review of project reports under Executive Order 9384, Submission of Reports to Facilitate Budgeting Activities of the Federal Government. This circular is intended to draw together certain of these policies for water resources programs and projects and to provide the agencies in advance with a better understanding of the considerations which will be used in determining the relationship of a proposed program or project, or budget estimate, to the program of the President. The standards and procedures set forth in this circular will be used by the Executive Office of the President in reviewing agency reports and budget estimates subject to its provisions, in order that uniform policies may be applied with a view toward (a) establishing priority for projects yielding the greatest value to the Nation, and (b) securing effective resources development at minimum necessary cost. The priority among programs or projects meeting the standards and procedures set forth in this circular, and action upon budget estimates to initiate such programs or projects, necessarily will also depend on budget policies established from year to year to meet current economic conditions. 2. Authority Executive Order 9384, October 4, 1943, requires submission to the Bureau of the Budget of reports relating to or affecting Federal public works and improvement projects. Bureau of the Budget Circular No. A-19, Revised, requires submission to the Bureau of agency reports on proposed and pending legislation. Bureau of the Budget Circular No. A-11, Revised, outlines the requirements for preparation and submission to the Bureau of annual budget estimates. This circular, No. A-47, supplements the requirements of the Executive order and circulars referred to, and is issued pursuant to the authority cited therein. 3. Coverage This circular relates to Federal programs or projects for the conservation, development, or use of water and related land resources. It applies to any report and to any budget estimate to initiate construction of a program or project, which, by the terms of the Executive order and circulars referred to in paragraph 2, is required to be submitted to the Bureau of the Budget and which involves a program or project of the type referred to in the first sentence of this paragraph. It does not apply to budget estimates for electric transmission lines or steam electric generating plants required in connection with water resources projects. 4. Compliance (a) Relation to existing law. -The standards and procedures set forth in this circular shall not be regarded as authorizing any deviation from general or specific requirements of law. Whenever a report or budget estimate varies from such standards or procedures because of a requirement of existing law, the variation shall be indicated and reference made to the section of law imposing such requirement. (b) Application to budget estimates.-Except as provided in paragraph 4a, a budget estimate subject to this circular shall conform to the standards and pro cedures set forth herein. (c) Variations from circular.—This circular shall not be regarded as requiring an agency to submit a report which is contrary to its views. However, any report which varies from the standards and procedures set forth herein because of agency policies shall, in the same manner as indicated in paragraph 4 (a), be accompanied by a statement of the reasons for the variation. Each report shall contain or be accompanied by appropriately documented information to indicate the exact extent to which the standards and procedures established herein have been followed in the preparation of the report. Where the preparation of the basic report is so far advanced on the date of issuance of this circular that it would be impracticable to furnish the information required by this circular, this fact will be taken into account in the consideration of the report. All reports submitted after July 1, 1953, however, must conform to the requirements of this circular. 5. Definitions For the purposes of this circular: (a) "Project" means any integral physical unit or several component and closely related units or features, or any system of measures, undertaken or to be undertaken within a specified area for the control or development of water or related land resources, which can be considered as a separate entity for purposes of planning, evaluation, financing, construction, management, or operation. units or features will generally be considered as separate projects. Separable (b) "Program" means any combination or system of two or more interrelated projects. (c) "Benefits," as used for purposes of evaluation of proposed programs or projects, means all the identifiable gains, assets, or values, whether in goods, services, or intangibles, whether primary or secondary, and whether measurable in monetary or nonmonetary terms, which would result from the construction, operation, or maintenance of a program or project. (d) "Primary benefits" means the identifiable gains, assets, or values directly resulting from any program or project. (e) "Secondary benefits" means identifiable gains, assets, or values other than primary benefits of a program or project which are properly creditable to the program or project. (f) "Economy costs," as used for purposes of evaluation of proposed programs and projects, means all the financial costs of the program or project except investigating, surveying, and planning costs incurred prior to authorization; and all the other identifiable expenses, losses, and liabilities, whether in goods, services, or intangibles, whether direct or induced, and whether measurable in monetary or nonmonetary terms, which are incurred as a result of constructing, operating, or maintaining a program or project. (g) "Financial costs" means all the monetary outlays made in connection with a program or project and interest costs connected therewith; i. e., the construction costs, the operation and maintenance costs, and interest on the unliquidated balance of the reimbursable construction costs. When applied to allocations made to irrigation for repayment purposes under paragraphs 7 (a) and 18 (b), "financial costs" shall not include interest on the irrigation construction costs. (h) "Construction costs" means expenditures (amounts paid and payable) for the initial project construction and the net replacements and additions of significant units thereof, including contract work, materials and supplies, labor, and use of equipment; acquisition of lands, easements, rights-of-way, and water rights; costs of relocating facilities and the settlement of damage claims; interest during construction; any capital expenditures for protection of public health, for preventing loss of or damages to recreation, fish and wildlife and mineral resources, and scenic, archeological, and historical values; any capital expenditures for the replacement of recreation and fish and wildlife resources, damaged or destroyed by the project; the appropriate portion of engineering, administrative, and general expenses of the agency relating to the project; and all other amounts of expenditures specifically applicable to the investigations, surveys, plans, designs, and construction of the project. When applied to allocations made to irrigation for repayment purposes under paragraphs 7a and 18b, "construction costs" shall not include interest during construction on the costs allocated to irrigation. (i) "Operation and maintenance costs" means those expenditures for materials and supplies, labor, necessary services, equipment and operating facility use, and an appropriate portion of engineering, supervision and general expenses of the agency which are needed to operate a project once constructed and to make repairs, minor additions and replacements, and otherwise to maintain the project in sound operating condition for a maximum economic life. This includes any expenditures of the project, other than capital expenditures, for ptotection of public health, for preventing loss of or damages to recreation and fish and wildlife resources, and scenic, archeological and historical values; and any/expenditures of the project, other than capital expenditures, for the replacement of recreation and fish and wildlife resources damaged or destroyed by the project. () "Net revenues" means the difference between the total revenues of the program or project or separable purpose thereof and the properly allocable financial costs of such program, project, or purpose. (k) "Reclamation" means making land suitable for productive agricultural use or increasing or maintaining its productive agricultural use by means of (1) irrigation; (2) drainage, excluding drainage undertaken pursuant to section 2 of the act of December 22, 1944 (58 Stat. 887), and excluding drainage undertaken soley to counteract the effects of flood-control works; and (3) recharging of ground waters. 6. State, local, and Federal participation Agencies responsible for developing proposed programs or projects shall, as now provided under certain laws and administrative practices, consult with the people of the area primarily affected and with the State and local governments and Federal agencies concerned. This consultation should take place at the earliest feasible stage and should be continued throughout the investigation, survey, and planning stages, in order that the views of these groups and agencies may receive adequate consideration. Such consultation need not be repeated at the time budget esimates to initiate a program or project are being prepared; however, budget estimates shall include the latest information available on the views of Federal agencies, States, and interested local groups as to priorities of project development, scheduling of construction, and willingness to comply with requirements for local participation. 7. Information for inclusion in, and criteria for review of evaluation reports (a) The following categories of information, some of which are elaborated in later paragraphs of this circular, shall be included in the evaluation report proposing authorization of a new water or related land resources program or project. Under certain of the categories of information listed below, there are indicated the criteria which will be used by the executive office in the review of proposed program or project reports: (1) A description of the need for the production or services which would result from the program or project; the relation of the program or project to the other elements of the resource development program of the region in which the program or project is to be undertaken; the contribution of the program or project to balanced national conservation and development; and the efficiency of the program or project in meeting regional or national needs. An important consideration in the review of evaluation reports will be whether execution of the program or project, and within practical limits, execution of each separate part of a program or project, will be more economical than alternative means available in the region for meeting the same needs. Where a single-purpose alternative is available, inclusion in a multiple-purpose program or project plan of any purpose of resource development will be considered only if the purpose is accomplished more economically through the multiple-purpose program or project than through the single-purpose alternative. A further consideration in the review of evaluation reports will be the relative economy of alternative means available on a national basis for meeting the needs to be met by the program or project. (2) A concise but complete estimate of all the benefits and all of the economic costs of undertaking the program or project. In addition to comparing the total benefits of the program or project with its total economic costs, the estimate should also show separately the particular benefits and economic costs attributa' le to each purpose of the program or project. Wherever appropriate, benefits and economic costs shall be expressed in monetary terms. Where monetary estimates cannot reasonably be made, the relative significance of such benefits and costs shall be stated in as precise and quantitative terms as possible. Because any long-term estimates are subject to wide margins of error, the results should be expressed in ranges rather than in single figures. The estimate should be made from an overall public or national viewpoint and should indicate any specifically identifiable groups, localities, or districts receiving program or project benefits. While it is recognized that a comparison of estimated benefits with estimated costs does not necessarily provide a precise measure of the absolute merits of any particular program or project, one essential criterion in justifying any program or project will, except in unusual cases where adequate justification is presented, be that its estimated benefits to whomsoever they may accrue exceed its estimated costs. Inclusion in a multiple-purpose program or project plan of any purpose of resource development will, except in unusual cases where adequate justification |